When to choose FHA - Is FHA right for me?

When shouldn't I use FHA -
If you can bring 10% downpayment and have a credit score around 680 and above, you can avoid one or both mortgage insurance types by going with a conventional loan product instead.

When should I use FHA -
FHA is perfect for people who have less than A credit and/or can't bring a large downpayment. FHA loans only require a 3.5% downpayment and a credit score of 640 in most cases. A 620 or even lower credit score can be used in certain situations as well.

This is where Spire Financial's Loan Specialists come in. Our Loan Specialists understand the various strengths and weaknesses of the lending partners and will place your loan at the lender with the product that fits your scenario the best. Call Spire Financial now and ask for a Loan Specialist at 303-595-0110. Get all your questions answered for free and at no obligation. Or email us at FHALoanQuestions@SpireFinancial.com.

FHA Mortgage Insurance

There are two types of mortgage insurance involved in an FHA loan:

1. Up Front Mortgage Insurance Premium (UFMIP)
2. Annual Mortgage Insurance (paid monthly)

Up Front MIP (UFMIP) -
UFMIP is what FHA charges to finance an FHA loan. The UFMIP is currently 1.75% of your loan amount. The UFMIP can be rolled in to the loan (financed). ie. If your loan amount is $200,000 then your UFMIP is $3,500. If you choose to roll this in, then your final loan amout would be $203,500.

Annual Mortgage Insurance -
In addition to UFMIP, you are required to pay annual mortgage insurance at 0.55%/year of the loan amount. This is collected as part of your monthly payment. Annual mortgage insurance is required to be paid until you have only 78% of your home value left on your loan. However, regardless of if you are at a loan-to-value at or lower than 78%, you are still required to pay annual MI for a minimum of five years.

Example on figuring annual mortgage insurance: Loan amount $200,000: $200,000 x 0.55% / 12 = $91.67/month

Do you have more questions on this? Email us at FHALoanQuestions@SpireFinancial.com.

FHA Streamline Loans

FHA Streamline Loans are designed to make it easy and cost effective for a current FHA customer to refinance their FHA loan in to a lower interest rate with minimal fees and documentation. There are two types of streamline refinances; with appraisal & without appraisal. There are benefits and drawbacks to both:

• Streamline with Appraisal
  - allows you to roll in closing costs up to 97.5% of the value of your home.
• Streamline without Appraisal
  - allows you to refinance without concern of a drop in home value. You must bring in closing costs with this option.

Do you have more questions on this? Email us at FHAaLoanQuestions@SpireFinancial.com.

FHA Interest Rates

FHA Interest Rates move every day. To get today's rate quote use the form at the top right of this page.

FHA Document Needs

Every lender is a little different, but here's what you can expect to need:

• Current Note & HUD (streamlines only)
• Last 2 W2's (not required on streamline)
• Last 2 months bank statements (may not be required on streamline)
• Last 2 months paystubs (not required on streamline)

FHA Downpayment

FHA only requires a downpayment of 3.5% on new home purchases. The downpayment must always be sourced. It can not come from a credit card or other liability type in most cases. The downpayment can come from a gift from a relative. When a gift is involved, the funds must be sourced from the giver in the form of a bank statement, a deposit slip, a gift letter, and proof the funds were liquidated in to the home buyer's account.